Zinc oxide nanoparticles (ZnONPs) are generally recognized as safe substances, leading to a growing interest in their applications, particularly when synthesized using various medicinal plants. In this study, an aqueous extract of Nyctanthes arbor-tristis leaves was used to synthesize NL-ZnONPs, and their various biological applications were assessed. The maximum absorbance (λmax) of NL-ZnONPs was found at 376 nm. SEM and XRD analyses confirmed the amorphous nature of the NL-ZnONPs, while FTIR analysis revealed that phytochemicals from the plant extract capped the surface of the NL-ZnONPs. NL-ZnONPs inhibited mammalian α-glucosidase activities-maltase, sucrase, isomaltase, glucoamylase-, and α-amylase activity through non-competitive inhibition, with IC50 values of 594.4 ± 1.79 µg/mL, 1160.2 ± 4.8 µg/mL, 648.4 ± 3.6 µg/mL, 719.3 ± 2.3 µg/mL, and 398.4 µg/mL, respectively. The NL-ZnONPs also reduced cell viability in A549, MCF7, and HepG2 cells, with IC50 values of 42.89 ± 1.8 µg/mL, 32.65 ± 4.8 µg/mL, and 159.15 ± 3.5 µg/mL, respectively. DNA fragmentation and apoptosis were observed in A549 and MCF7 cells through DAPI and acridine orange/ethidium bromide fluorescence staining. Additionally, NL-ZnONPs exhibited antibacterial activity against Klebsiella pneumoniae, Staphylococcus aureus, Escherichia coli, and Candida parapsilosis at a concentration of 100 µg/mL. Overall, NL-ZnONPs demonstrated effective antidiabetic activity by inhibiting carbohydrate-metabolizing enzymes, as well as significant anticancer and antimicrobial activities.